Who’s the Most Gung Ho About Saving for Retirement? The Answer May Surprise You
A new survey done by the Maritz corporation for Ameritrade in the 3rd quarter of 2011 has found that Gen Y is most likely to be doing all it can to save for retirement, even more so than Gen X, Boomers and Matures.
While 85% of working Americans today have an IRA or 401(k)/403(b) retirement plan, Generation Y (defined as born from 1977-1989 for study purposes) is most rigorous about saving to the best of its ability. The study found that 25% of Generation Y is funding both work sponsored plans and IRAs. That’s compared to 23% of Generation X (born from 1965 to 1976), 16% of Boomers (born from 1946 to 1964), and 9% of Matures (born from 1930 to 1945).
It’s somewhat surprising that Generation Y, known for wanting everything right now, has the foresight to see the importance of saving for something so far in the future as retirement. So what’s behind this trend?
One reason might be that Generation Y is known for its optimism. Generation X and Boomers have watched their 401(k) plans shrink after stock markets plummeted in the recession. They’ve also watched interest rates for savings plans drop considerably. So they may be just a bit tired of scraping and saving to watch the market lose what they’re putting in. Generation Y is more optimistic that the markets and savings rates will increase and they will be rewarded for saving. They’re also more savings savvy. Many of Gen Y know that if they put in the effort now, time will do much of the wealth accumulation for them, even at lower interest rates. Additionally, many have watched their parents go through financial hard times and are determined to do better. Finally, many Gen Y’ers are living with their parents longer than before and delaying marriage, mortgages and children. This gives them more money to put toward saving for retirement.
So what does this mean from a marketing standpoint? Basically it opens up an entirely new demographic in which to market financial and retirement services. Don’t count Generation Y out, even though your inclination may be to target Generation X and Matures first for these services. It also means that you will probably have to target by generation, as retirement and success mean different things to these generations.
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If you could grow your business simply by marketing to your existing customers, making money would be a cakewalk. But to generate new revenue, you have to win over the customers you’re not getting. Who are these mystery customers? How are they different from your current clientele? Most importantly, how do you forge a bond with them across these differences?
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About the Author
Kelly McDonald
Kelly McDonald is a marketing and advertising expert with more than 20 years of global advertising agency experience.
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You've got a great newsletter, Kelly. Full of such amazing information! You do an amazing job and I can't wait to hear you again in June. Barcelona, Spain? You Rock, Lady!
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